Reply to: Members Club Fees as allowable expenses?

[wapperer]

You'd owe the tax that you got relief on from claiming the deduction and potential interest on top e.g. say you claimed £1k of expenses which they disallowed. If that £1k originally saved you £200, you'd be liable to pay that £200 back to HMRC plus late interest.

Thanks for the insight. Much appreciated.

[Craig@Clarity]

Thanks, and just out of interest what would be the consequence if they disallow it despite evidence?

You'd owe the tax that you got relief on from claiming the deduction and potential interest on top e.g. say you claimed £1k of expenses which they disallowed. If that £1k originally saved you £200, you'd be liable to pay that £200 back to HMRC plus late interest.

[wapperer]

In that case, I'd say claim for the business portion of it. Keep diary notes of meetings and appointments to support the business element of it. At the end of the day, it's up to HMRC to argue that the portion of cost claimed isn't the correct business element and up to you to justify it. In all likelihood, I don't think HMRC will pick up on it but as is always the case, have supporting evidence and back up your claim in advance, just in case.

Thanks, and just out of interest what would be the consequence if they disallow it despite evidence?

[Craig@Clarity]

I probably should have said im a sole trader - I see your point about BIK - -but unlike a gym membership or a private box etc it has a business use 99% of the time as a place of business which I started using instead of the £400 a month coworking space (weWork - what a load of poop that was). I think ill just forget about it then - I thought that It would perhaps workout because I was actually saving money in terms of the businesses expenses but I now see its not that simple.

thanks people

In that case, I'd say claim for the business portion of it. Keep diary notes of meetings and appointments to support the business element of it. At the end of the day, it's up to HMRC to argue that the portion of cost claimed isn't the correct business element and up to you to justify it. In all likelihood, I don't think HMRC will pick up on it but as is always the case, have supporting evidence and back up your claim in advance, just in case.

[wapperer]

You're welcome. Just sack your bloody accountant. He's bobbins.

Consider him marched off the premises!!

[northernladuk]

thanks people

You're welcome. Just sack your bloody accountant. He's bobbins.

[wapperer]

You can have your company pay for the club fees and treat it as an expense in the company. However, you should then treat the cost as a benefit in kind and declare it on your P11D, have the company pay the class 1A NIC and you take the hit on your personal tax. If it is the case that you would not use it for personal use, the fact that it is available for personal use would mean it's subject to a BIK. I'm viewing this similarly to gym memberships and corporate boxes.

I probably should have said im a sole trader - I see your point about BIK - -but unlike a gym membership or a private box etc it has a business use 99% of the time as a place of business which I started using instead of the £400 a month coworking space (weWork - what a load of poop that was). I think ill just forget about it then - I thought that It would perhaps workout because I was actually saving money in terms of the businesses expenses but I now see its not that simple.

thanks people

[Craig@Clarity]

You can have your company pay for the club fees and treat it as an expense in the company. However, you should then treat the cost as a benefit in kind and declare it on your P11D, have the company pay the class 1A NIC and you take the hit on your personal tax. If it is the case that you would not use it for personal use, the fact that it is available for personal use would mean it's subject to a BIK. I'm viewing this similarly to gym memberships and corporate boxes.

[wapperer]

It does? Oh that's OK then.

IMO if you can look HMIT in the eye and argue that it's 99.9% for business then claim it. If deep in your heart you know you are taking the piss and just looking for us to back you up then don't.

Not much more to it than that I'd say.

Can you get membership in the company name and company pay it. Some clubs allow this.. Well the good ones do.

I registered with my business name and email address, registered postal address. Id rather not look HMIT in the eye ta! I get that people take the pee but when its a real business use case why can't a portion of the cost be used? am I being petty?

[northernladuk]

It does? Oh that's OK then.

IMO if you can look HMIT in the eye and argue that it's 99.9% for business then claim it. If deep in your heart you know you are taking the piss and just looking for us to back you up then don't.

Not much more to it than that I'd say.

Can you get membership in the company name and company pay it. Some clubs allow this.. Well the good ones do.

[wapperer]

You need to sack yourself and get a proper one then

Well the first response shows the T&C's for the establishment in that question doesn't condone business meetings so you need to check where ever you go does. I'd guess at those prices it's not very high brow so you might be OK. The T&C's in the Manchester ones talk about guests so not sure that means business guests and one of them has a mobile phones restrictions which is hardly conducive to business.

The T&C's might preclude you from using it as you really want.

Then the second one says there are other stuff to do so it ceases to become wholly and exclusively so kinda answers your question.

The club itself actively asks if you would like to use for business use in the application and encourages via newsletters etc to use the space to meet clients (and buy them drinks of course - not tax deductible I know!)

The confusion comes in that many other expenses can be apportioned and not necessarily wholly for business use. in my use case the use of the club actually significantly reduces the expense amount compared to when I was using a made-for-business working space (that was rubbish and 4 times the cost).

[northernladuk]

I like your risk attitude. I really very rarely go there for private use as Im there for work so much its kind of the last place I want to be for fun!

But you do so technically....

[wapperer]

Probably because it’s a question that’s very open to interpretation and your attitude to risk.

IMO if you never use it for personal use and you can justify it for your business then you can claim it 100%. But my risk attitude is not everyone’s.

I like your risk attitude. I really very rarely go there for private use as Im there for work so much its kind of the last place I want to be for fun!

[northernladuk]

Haaaa. Eagle Eyes!! - I am my accountant. lol

You need to sack yourself and get a proper one then

Well the first response shows the T&C's for the establishment in that question doesn't condone business meetings so you need to check where ever you go does. I'd guess at those prices it's not very high brow so you might be OK. The T&C's in the Manchester ones talk about guests so not sure that means business guests and one of them has a mobile phones restrictions which is hardly conducive to business.

The T&C's might preclude you from using it as you really want.

Then the second one says there are other stuff to do so it ceases to become wholly and exclusively so kinda answers your question.

[Lance]

Unfortunately not very helpful answers on that post :/

Probably because it’s a question that’s very open to interpretation and your attitude to risk.

IMO if you never use it for personal use and you can justify it for your business then you can claim it 100%. But my risk attitude is not everyone’s.